Brazil's fourth biggest airline BRA will announce today in a press conference the firm order of 40 x E195s, with an option of another 20 x E195s, making this Embraer's third major order in Le Bourget after JAL and LH announcements.

BRA's order has a face value of USD 1.5 billion. and delivery will start in 2008. The jets will have 118 Y seats and financing by the Brazilian Social and Economic Development Bank. BRA will be the only Brazilian airline using Embraer jets. Before the delivery start, BRA will lease 2 x E195 early in 2008. BRA will use the jets to explore the lucrative market between medium sized destinations in Brazil.

BRA will therefore increase competition in the Brazilian market where TAM and VARIG+GOL detain 95% of the domestic market share. BRA's received a major boost in December as it was taken over by a group of investors comprised of Brazil Air Partners - a fund of Bank of America, Gávea Investimentos, Development Capital, Goldman Sachs, HBK Investment and Millenium Americas. BRA is also launching an IPO in about three months.

Quote:
Embraer and Brazilian airline BRA Transportes Aéreos have signed a preliminary commercial agreement for 20 firm orders of the EMBRAER 195 jet, plus 20 options. The final contract for this transaction should be finalized,shortly, by both companies.

In the press releases, it says that BRA will acquire an extra 2 763s (Ex RG, PP-VOI and PP-VOJ) for flights to Spain, Portugal, Italy and Morroco (?!)

Given the alliance with OceanAir, I wonder if there is a combined strategy going forward, especially on long haul flights, or if each will do its own?
I would have thought that given the small number of 767s between the BRA and OceanAir, only of the two should run the lot. A slight inconvenient is that the engines OceanAir's are PW, whereas BRA's are GE as I understand it.

The new investors in BRA are major investment banks and funds, and that will bring a very professional approach to the airline's management, I believe.

With another very professional and successful businessman in command of OceanAir, and with the new partnership they are developing in Brazil, how long will it take to BRA and Efframovich (OceanAir) to realize that a merger between them will bring a real 3rd force for the country's aviation, one with the necessary financial backing to really confront TAM and Gol?

Quoting FMAL (Reply 12):With another very professional and successful businessman in command of OceanAir, and with the new partnership they are developing in Brazil, how long will it take to BRA and Efframovich (OceanAir) to realize that a merger between them will bring a real 3rd force for the country's aviation, one with the necessary financial backing to really confront TAM and Gol?

What I wonder is if BRA (perhaps Tropical Alliance as well?) will remain a niche player (even if they grow strong) or whether they could present a very real threat for JJ and G3? I'm betting on the niche, but I think it should be a decently-sized market.

Quoting PPVRA (Reply 15):What I wonder is if BRA (perhaps Tropical Alliance as well?) will remain a niche player (even if they grow strong) or whether they could present a very real threat for JJ and G3? I'm betting on the niche, but I think it should be a decently-sized market.

A possibility, for sure. If TAM/Gol consolidate their duopoly to such an extent that they effectively control the Brazilian market (as they do now), BRA/Ocean Air possibly will have to focus on a niche strategy to bring in dividends for their investors/owners. In the end, is all about making money, as it should be.

It'll be nice to finally see an E-Jet flying for a brazilian airline again. One thing though: BRA needs to work on a new livery ASAP - could be introduced when (if - I still have my doubts whether will really see this bird) the first E-Jet is delivered.